Related Experiment Videos
Fundholding in general practice and financial risk
B J Crump1, J E Cubbon, M F Drummond
1Department of Public Health Medicine, Central Birmingham Health Authority, Edgbaston.
BMJ (Clinical Research Ed.)
|June 29, 1991
Summary
Random yearly changes in healthcare demand significantly impact general practitioner (GP) fundholding finances, especially for smaller practices. Financial risks increase with smaller patient lists, requiring careful management to ensure scheme viability.
Area of Science:
- Health economics
- General practice management
- Healthcare finance
Background:
- General practitioner (GP) fundholding schemes aim to manage healthcare budgets.
- Variations in patient service needs can create financial unpredictability.
- Understanding these financial impacts is crucial for effective practice management.
Purpose of the Study:
- To quantify the financial effects of random annual variations in service demand on GP fundholding practices.
- To analyze these effects across different practice list sizes.
Main Methods:
- A simulation model was developed using historical referral data and hospital prices for 113 surgical procedures.
- The model simulated 100 years of expenditure for the Central Birmingham Health Authority and practices of varying list sizes (9,000 to 24,000).
Main Results:
- Annual expenditure for 179,400 residents averaged £4,832,471, with a 5.7% variation.
- A practice with 9,000 patients faced a 27.5% variation in expenditure, while a practice with 24,000 patients had a 15.3% variation.
Conclusions:
- Random fluctuations in demand for inpatient services pose significant financial risks to GP fundholding budgets.
- Smaller practices are disproportionately affected by these financial variations.
- Additional strategies are necessary to mitigate risks and ensure the success of fundholding schemes.